If publishers are setting their prices for ebooks by geographical differences in average income, when the cost of the ebook is not dependent on the geographical location of sale, then I think that is simply unfair.

After all, there are differences in average income between different age, gender and racial groups too. Should publishers set their prices based on age, gender or race? If they did then I think they could be prosecuted under human rights legislation.

So why is geographical discrimination allowed but age, gender and racial discrimination not?

If publishers are setting their prices for ebooks by geographical differences in average income, when the cost of the ebook is not dependent on the geographical location of sale, then I think that is simply unfair.

After all, there are differences in average income between different age, gender and racial groups too. Should publishers set their prices based on age, gender or race? If they did then I think they could be prosecuted under human rights legislation.

So why is geographical discrimination allowed but age, gender and racial discrimination not?

Absolutely true. Publishers of course are not setting their prices on such a basis. They are trying to continue their past practice of setting their prices at the maximum amount that a particular market will bear. The fundamental problem they face is that there is now only one market.

The purpose of agency was to prevent books overall from being cheapened in the eye of the public. That was the conspiracy. There was no conspiracy to harmonize the amounts paid as advances, or sell titles from different publishers at the same price.

Now, price maintenance schemes such as agency do reduce competition between retailers. But agency didn't destroy competition between Penguin and Bertelsmann, or Hachette and Perseus. What destroys competition between the publishers is mergers and acquisitions. This is especially true of the Penguin Random House deal, since, more often than with Hachette and Perseus, Penguin and Random House might have been bidding on the same book.

If I ran the world (not a good idea), I would give the publishers agency in return for banning mergers.

Good summation. The driving force behind all the mergers was that the overhead costs where starting to become significant enough that publishers could achieve significant cost savings by merging and cutting staff, just like every other industry where there are significant mergers. If I recall correctly, a lot of the publishing mergers were driven by the changes in the tax codes which caused a big increase in the cost of maintaining inventory.

I do think that with ebooks and JIT book printing, we may see a revival of the small publishers.

There must be a larger number of cases where there is no bidding war, but the offered advance is higher than it would have been to make one breaking out less likely.

Now, if you mean competition between publishers on pricing, that is harder to document. Mike Shatzkin has speculated that PRH is too big to bully and nobody else is. If his speculation is correct, I think you could also say, albeit from quite a different perspective, this: Penguin and Random House used to complete on wholesale pricing terms with their biggest account, but now do not.

There will always be expensive real estate especially during the "booming" years that Australia recently experienced. The article did say prices were falling. It also mentions prices increased due to "restrictive land supply policies."

And the article doesn't say what Australia's average is as a whole.

Quote:

Perth's median multiple for housing affordability is measured at 5.6, behind Sydney (8.3), Melbourne (7.5) and Adelaide (6.5) but more than the national marks for Canada (3.6), Ireland (3.2), the UK (5.1) and US (3.1).

Somehow they determined that the US has affordable housing. Now that's funny ... and not believable ... and apparently their data contains errors.

There will always be expensive real estate especially during the "booming" years that Australia recently experienced. The article did say prices were falling. It also mentions prices increased due to "restrictive land supply policies."

And the article doesn't say what Australia's average is as a whole.

Somehow they determined that the US has affordable housing. Now that's funny ... and not believable ... and apparently their data contains errors.

The number for Australia as a whole is 5.5.

And the US has *extremely* affordable housing. Unless you live in California. My city, which is about the size of Perth, although with no ocean view, has a number of 2.4.

There must be a larger number of cases where there is no bidding war, but the offered advance is higher than it would have been to make one breaking out less likely.

Now, if you mean competition between publishers on pricing, that is harder to document. Mike Shatzkin has speculated that PRH is too big to bully and nobody else is. If his speculation is correct, I think you could also say, albeit from quite a different perspective, this: Penguin and Random House used to complete on wholesale pricing terms with their biggest account, but now do not.

Thanks for your examples Steve. And yes, I was more interested in publishers competing on price. Because to me this seems the only meaningful competition that could keep prices reasonable under an agency pricing model, where the Publishers take control at the retail level.

As I suspected they only calculated average home price by household income. They didn't include income taxes, property taxes, maintenance and hazard insurance.

There are only 14 areas in the US with affordable housing. Nothing is mentioned about housing for those with low wages. Nor Rents!

My town is 6.2.

Ouch; 6.2.

The 14 "affordable markets" are only for metro areas greater than 1 million.

But if you look at the table on page 4 - there are 84 "affordable" markets [3.0 and less] in the US (out of 236 total); 100 moderately unaffordable [3.1-4.0]; 29 seriously unaffordable [4.1-5.0]; and 23 severely unaffordable [5.1 +].

Moderator NoticePlease take discussions of house prices to either the Lounge or the P&R forum. The topic of this thread is "Agency Pricing Seems to be alive and well in Australia". Any further off-topic posts will be deleted.

Golly Harry, it seems to me that the discussion as a whole has been on topic, and that the issue of house prices was and is only one of the indices used by some members when discussing whether the price of a book is relative to the state of the economy and the general personal affordability ratio of the given country.

Whilst I may not contribute to economic arguments I still value the contribution of those who do.

The cost of buying a book, the cost of selling a book and the pricing formulas and the relative contingencies seems to be a fairly broad brush in my opinion.

Agency pricing has led to a greater variety of places to buy e-books, imho. Now, it does suppress competition on price, but at least it's allowed places like Kobo to exist. While I'm aware that Amazon never treated all e-books as loss leaders, it's a well known fact that their profit margins are razor thin and that very few companies can survive at that level.

I don't want to live in a world where Amazon is the only place I can get e-books from major publishers. (Don't get me wrong, I'm sure places like Baen & Smashwords would survive, but I read more then the authors they sell.) I'm already annoyed with Amazon as they have sole e-book rights to Ian Fleming's catalogue.

Kobo has their faults, but they're more open in the e-book realm then Amazon, and they don't treat Canada as a secondary market.

Arrgh. Kinda rambling there. Anyways, I don't regard Agency as intrinsically evil, as long as the publishers treat the price points in a fair fashion. Most of the publishers I consume from set their e-book prices at slightly lower then the p-books, which makes sense to me. As I would've happily paid the p-book price back before I switched, I have no issues with paying a little less and getting a format I enjoy more.